Atlas Engineered Products Reports Record Revenue and Net Income for Q2 2019

NANAIMO, BC, July 30, 2019 /CNW/ - Atlas Engineered Products Ltd. ("AEP" or the "Company") AEPAPEUF)) announces its financial and operating results for the three and six months ended June 30, 2019. All amounts are presented in Canadian dollars.

"I am pleased to report a record overall quarterly revenue result and that quarterly net income was positive for the first time since our public listing in November of 2017. This was achieved through significant organic growth and operational efficiencies in the first half of 2019", said AEP CEO & President Dirk Maritz.

Financial Highlights

• Overall revenue for the three and six months ended June 30, 2019 was $9,067,334 and $15,284,242 respectively, up from $3,987,449 and $6,066,495 for the three and six months ended May 31, 2018, representing overall growth in revenue from the prior comparative period of 127% and 152%, respectively. This increase in overall revenue was a result of organic growth in AEP's existing operations, as well as additional revenue from our acquisitions.
  
  
• Compared to the financial year ended December 31, 2018 (-4.9%), AEP generated a positive adjusted EBITDA margin of 17.0% for the second quarter ended June 30, 2019, up from 3.2% for the Company's first quarter ended March 31, 2019. For the six months ended June 30, 2019, adjusted EBITDA margin was 11.4%.
  
  
• Operating income has turned sharply positive at $782,013 and $303,092 for the three and six months ended June 30, 2019, compared to operating losses of ($543,575) and ($792,990) for the three and six months ended May 31, 2018.
  
  
• AEP reported net income after taxes of $162,876 for the quarter ended June 30, 2019. This is the first quarter that AEP has reported net income since going public in November 2017.
  
  
• AEP restructured some of its debt to more favourable terms, strengthening its balance sheet and more closely aligning the repayment terms to the seasonality of AEP's business. Some term loans have been restructured to be interest-only payments from January to May when the construction season is slower and retaining cash is important. From June to December, when construction and building activities are at their peak, AEP will make principal and interest payments.

"In the last quarter we announced significant nation-wide supply and service agreements that will result in long-term bottom line benefits to all our current and future operations," explained Mr. Maritz. "We were also able to execute on our plan to expand product offerings at our facilities and continued to grow our sales force, all of which allows us to compete for, and win, larger and more complex project bids across the country."

About Atlas Engineered Products Ltd.

AEP is a newly listed growth company, as of November 2017, that is acquiring and operating profitable, well-established operations in Canada's truss and engineered products industry.  AEP has a well-defined and disciplined acquisition and operating strategy enabling it to scale aggressively and giving AEP a unique opportunity to consolidate a fragmented industry of independent operators.

Forward Looking Information

Information set forth in this news release contains forward-looking statements. These statements reflect management's current estimates, beliefs, intentions and expectations; they are not guarantees of future performance. The Company cautions that all forward looking statements are inherently uncertain and that actual performance may be affected by a number of material factors, many of which are beyond the Company's control.  Such factors include, among other things: Risks and uncertainties relating to the Company, including those to be described in the Management's Discussion and Analysis ("MD&A") for the Company's three and six months ended June 30, 2019.  Accordingly, actual and future events, conditions and results may differ materially from the estimates, beliefs, intentions and expectations expressed or implied in the forward-looking information. Except as required under applicable securities legislation, the Company undertakes no obligation to publicly update or revise forward-looking information.

Selected Financial Information

Except as noted below, the financial information provided in this news release is derived from the Company's unaudited financial statements for the three and six months ended June 30, 2019 and the related notes thereto as prepared in accordance with International Financial Reporting Standards ("IFRS") and related IFRS Interpretations Committee ("IFRICs") as issued by the International Accounting Standards Board ("IASB").  A copy of the Company's unaudited financial statements for the three and six months ended December 31, 2018  and the related Management's Discussion and Analysis is available on the Company's website at www.atlasengineeredproducts.com or on SEDAR at www.sedar.com.

Financial information for the Company's acquisitions are included in the Company's audited financial statements from the date of acquisition.  Financial information for acquired businesses for periods prior to the date of acquisition were prepared by management and have not been reviewed or audited by independent auditors.

Non-GAAP / Non-IFRS Financial Measures

Certain financial measures in this news release do not have any standardized meaning under IFRS and, therefore are considered non-IFRS or non-GAAP measures. These non-IFRS measures are used by management to facilitate the analysis and comparison of period-to-period operating results for the Company and to assess whether the Company's operations are generating sufficient operating cash flow to fund working capital needs and to fund capital expenditures. As these non-IFRS measures do not have any standardized meaning under IFRS, these measures may not be comparable to similar measures presented by other issuers. The non-IFRS measures used in this news release include "EBITDA", "EBITDA margin", "adjusted EBITDA", and "adjusted EBITDA margin". "EBITDA" is calculated as revenue less operating expenses before interest expense, interest income, amortization and depletion, impairment charges, and income taxes. "EBITDA margin" is EBITDA expressed as a percentage of revenues. "Adjusted EBITDA" is EBITDA after adjusting for share-based payments, foreign exchange gains or losses and non-recurring items. "Adjusted EBITDA margin" is adjusted EBITDA expressed as a percentage of revenues.

NEITHER THE TSX VENTURE EXCHANGE NOR ITS REGULATION SERVICES PROVIDER (AS THAT TERM IS DEFINED IN THE POLICIES OF THE TSX VENTURE EXCHANGE) ACCEPTS RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS RELEASE.

SOURCE Atlas Engineered Products Ltd.

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